SoftBank pulls the plug on $3 billion WeWork bailout

SoftBank has officially pulled the plug on its $3 billion tender offer for WeWork shares, which was agreed to last fall and scheduled to close yesterday.

Why it matters: This is money that was all but promised to early WeWork employees and investors, some of whom may have made major financial decisions based on its receipt. The snarkier coverage may focus on the $970 million that former WeWork CEO Adam Neumann "lost," but that shouldn't obscure where the bulk of the money was to go.

Balance sheet: None of the $3 billion was designated for WeWork itself, but there was $1.1 billion of debt financing contingent on the tender closing. SoftBank still could provide the $1.1 billion, but is no longer obligated to do so, thus giving WeWork less financial flexibility at a time when its co-working model is anathema to public health.

The bottom line: SoftBank says its decision was based on WeWork not meeting all of the closing conditions, including "at least one" antitrust approval, plus the launch of both civil and criminal investigations that could create material liabilities.

• It is worth noting that SoftBank had two directors on the WeWork board prior to the tender agreement, and subsequently installed one of its own executives, Marcelo Claure, as executive chairman.